Focus on fifteen cases for year-end list

12.21.15

As the second decade of the millennium reaches its midpoint, the past year had more than its usual number of notable rulings, especially in criminal law matters, by the federal and state appellate courts for Minnesota.

Here’s a glance at 15 of them. They represent the most interesting or important cases, or in some instances, both significant and stimulating rulings in 2015.

The focus ranges from Minnesota-related litigation before the U.S. Supreme Court to a decision of its Minnesota counterpart allowing greater access to legal proceedings in this state.

Supreme suits

The most noteworthy Minnesota-related case of 2015 was not even a Minnesota case at all. But the ruling by the U.S. Supreme Court requiring the recognition of same-sex marriages across the country in Obergefell v. Hodges, 135 S.Ct. 2584 (2015) has definite and discernible roots in this state.

The ruling overturned a precedent of more than four decades from Minnesota, Baker v.Nelson, 409 U.S. 810 (1972), which dismissively disposed of an appeal from the Minnesota Supreme Court challenging a refusal to grant a marriage license to a couple of gay men from Hennepin County on grounds that the litigation did not present a “substantial federal question.” Times changed, as did public attitudes toward same sex marriage, spurred by the defeat in 2012 of a ballot proposition in Minnesota to elevate the statutory prohibition of same sex marriage, which underlined the Baker ruling, to state constitutional status. The defeat led to the enactment the following year of Minn. Stat. § 517.01, permitting marriage regardless of gender. Minnesota’s experience was part of the sea of change that saw the decision by the high court of four consolidated cases from Ohio, Tennessee, Kentucky and Michigan invalidating same sex marriage. In its 5-4 decision the court barely mentioned the Bakercase. Writing for the majority, Justice Anthony Kennedy declared that “marriage is a fundamental right” and, in venerating the institution, concluded in passing that the Bakerdecision is “must be and is overruled.”

Minnesota lawyers also obtained reversals of two other Eighth Circuit rulings during 2015. In Mellouli v. Lynch, 135 S.Ct. 1980 (2015), the court reversed an order for removal, or deportation, of a permanent resident from Tunisia who was convicted in Kansas of a minor misdemeanor offense for possessing drug paraphernalia. Represented by a coalition that included the new University of Minnesota Law School Center for New Americans, the deportee was entitled to remain in this country. The 7-2 ruling, authored by Justice Ruth Bader Ginsberg, reasoned that deportation was improper because there was no direct link between the minor paraphernalia possession offenses and federal controlled substance law that would subject him to deportation under 8 U.S.C. § 1227(a)(2)(P)(1).

A white supremacist from southern Minnesota represented by the federal public defenders obtained a re-sentencing on his 15-year imprisonment imposed via the residual clause of the Armed Career Criminal Act, 18 U.S.C. § 924 (e) (1), under the statutory residual clause, which allows enhanced sentences for unspecified “violent” felonies. InJohnson v. United States, 135 S.Ct. 2551 (2015), the High Court, in an 8-1 decision written by Justice Antonin Scalia, scrapped the shapeless residual clause because its vagueness “does not comport with the Constitution’s guarantee of Due Process” and remanded for re-sentencing. Justice Samuel Alito dissented.

This pair of Eighth Circuit reversals was in keeping with the lowly record of that tribunal during the 2014-15 term of the Supreme Court, which reversed seven of the eight rulings that went up, a reversal rate of 87 percent, compared to an overall overturn rate of about 72 percent.

Insurance Issues

Minnesota has become Ground Zero for an arrangement known as stranger-obtained life insurance, a multi-billion dollar but still relatively obscure industry in which individuals acquire life insurance on elderly individuals with whom they have no pre-existing affiliation or relationship. A pair of rulings of the Eighth Circuit Court of Appeals in cases arising from the U.S. District Court in Minnesota exemplified the centrality of Minnesota in this burgeoning enterprise. In PLH Variable Insurance Co. v. Bank of Utah, 780 F.3d 863 (8th Cir. 2015), the Eighth Circuit reversed a ruling by U.S. District Court Judge Ann Montgomery that the third party purchaser of a life insurance policy on a 74-year old Minnesota man lacked standing to collect the $5 million proceeds after his death. A decision written by Judge James Loken of Minnesota, reasoned, as a matter of state law, that the Minnesota Supreme Court would not deem the assignment “void as contrary to some public policy.”

Judge Loken and colleagues expressed some concerns about the propriety of the STOLI practice, but left the matter to “legislators and insurance regulators,” not judicial prohibition.

But the same panel held that fraud permeated – and invalidated – another STOLI transaction in PLH Variable Insurance Co. v. 2008 Christa Joseph Trust, 782 F.3d 976 (8th Cir. 2015). Although “not a simple case,” it affirmed a decision of U.S. District Court Judge Patrick Schlitz that a $10 million policy on the life of a relatively impecunious seamstress could not be submitted for payment by the STOLI assignee because it was part of a scheme to defraud the insured.

Defamation decisions

The Minnesota Court of Appeals rendered a pair of decisions in unusual defamation cases in 2015.

The rarely invoked criminal defamation statute will not be used any longer, at least not in its current statutory form. The appellate court held in State v. Turner, 864 N.W.2d 204 (Minn. App. 2015) that the measure, Minn. Stat. § 609.765, is an unconstitutional abridgement of freedom of expression. While the actions of an Isanti County man who published salacious material on the Internet about his ex-girlfriend and her daughter were “reprehensible and defamatory,” the statute was impermissibly overbroad.

Another defamation case that failed to elicit a ruling on the merits was Pfeil v. St.Matthew Evangelical Lutheran Church, 2015 Minn. App. LEXIS 39 (Minn. App. 2015)(unpublished), pet. for rev. granted, in which a member the church congregation in Worthington was not entitled to sue the church for defaming him in connection with expulsion from the congregation. The court reasoned that because the ouster was based on the claimant’s deviation from the church’s proscribed religious stance, passing upon it would violate the “ecclesial abstention doctrine,” a tenet of separation of church and state making religious rationales off-limit for judicial scrutiny.

But the final word has not yet been pronounced on that case because the Supreme Court accepted petition for review, heard the case in mid-September and is currently pondering how to handle it. A ruling is expected soon.

Warrant Woes

Criminal defendants suffered woes in a pair of decisions by the Minnesota Supreme Court concerning search warrants that precipitated criminal charges against them.

In State v. McMurray, 860 N.W.2d 686 (Minn. 2015), the court ruled that police officers were not required to obtain a search warrant to sift through a Hutchinson man’s trash on grounds that an individual does not have an “expectation of privacy” in garbage placed outside the home for collection. The decision, rendered under the search-and seizure provision of the Minnesota State constitution, Article I, § 10, refused to grant greater protection under that provision than the U.S. Supreme Court has done under the comparable provision of the Fourth Amendment of the U.S. Constitution.

The decision drew a dissent from Justice David Lillehaug, joined by Justice Alan Page, who opined that “basic rights and liberties are at risk if government can seize and search Minnesotan’s household wastes without a search warrant [or] … without even a reasonable articulable suspicion of wrongdoing.”

Law enforcement authorities also were not required to obtain a search warrant to take a breath test of a suspected drunken driver in State v. Bernard, 859 N.W.2d 762 (Minn. 2015).

But the last word has not yet been heard on that issue as the U.S. Supreme Court last week agreed to review the case.

The Minnesota justices ruled that a Dakota County man was properly charged with refusing to submit to the breathalyzer under the state’s implied consent law. Writing for the court, Chief Justice Lorie Gildea pointed to the warrant exception in the interests of officer’s safety or to prevent “destruction of evidence.” Justice Page dissented again, this time with Justice David Stras, lamenting that the ruling nullifies the warrant requirement in nearly every drunk driving case, a result that the dissenters said was “born of obstinance.”

But the Court of Appeals subsequently took a different tack in State v. Trahan, 870 N.W.2d 396, (Minn. App. 2015). Its 2-1 decision overturned the conviction of a White Bear Lake man who was sentenced to 5 years in jail for refusing to submit to a breath test after he was arrested in Ramsey County for drunk driving three years ago. Despite the Bernardruling, the authorities should have obtained a search warrant to conduct a blood test because of the “invasive” nature of using a needle to draw blood, compared to the less intrusive breath test. A petition for review has been filed with the Minnesota Supreme Court.

Counsel Conduct

The conduct of lawyers was addressed in a quartet of civil and criminal cases during the past year.

Ineffective assistance of counsel was raised as a basis for obtaining reversal of criminal convictions in two of them. In State v. Cunningham, 2015 Minn. App. LEXIS 1008 (Minn. App. 2015) (unpublished), concessions by defense counsel of his client’s guilt of some charges as part of a DWI prosecution did not warrant reversal. The defendant acquiesced to the admissions of guilt, the court said.

The failure of counsel to inform an alien from El Salvador of the likely removal consequences of a guilty plea to making terroristic threats was insufficient to allow the immigrant to withdraw the plea in Avendano v. State, 2015 Minn. App. LEXIS 1013 (Minn. App. 2015)(unpublished). The lawyer’s performance did not fall below “objectively reasonable” standards because it was not clear at the time whether such a plea would be grounds for mandatory deportation under federal law, although the deportation was subsequently upheld by the Eighth Circuit in Avendano v. Holder, 770 F.3d 731 (8th Cir. 2015).

The decision contrasted with another ruling by the appellate court allowing an undocumented immigrant who pled guilty to a domestic assault charge a decade ago, to withdraw the plea because he was not properly warned about the deportation consequences in Martinez v. State, 2015 Minn. App. LEXIS 377 (Minn. App. 2015)(unpublished). Because the alien had not received an “immigration consequences” warning, the guilty plea was “not intelligently made,” warranting a new hearing for post conviction relief.

An attorney withdrawing from representing a client in a civil case without good cause is not entitled to any portion of a contingency fee resulting from a subsequent settlement case by substitute counsel, according to the Supreme Court ruling in In re Petition for Distribution ofAttorney’s Fees, 2015 Minn. App. LEXIS 16 (Minn. 2015). The court reasoned that the client’s refusal to accept a settlement recommended by the lawyer settlement entitled the attorney to withdraw, but the departing lawyer could not then assert a claim for contingency fees when the case was subsequently resolved for a higher amount.

The “good faith” reliance upon advice of counsel constituted justification for a party to disregard a new employee’s noncompete agreement in Sysdyne Corp. v. Rousslang, 869 N.W.2d 347 (Minn. 2015). Affirming a ruling of the Minnesota Court of Appeals, which graced this column’s top cases list last year, the court unanimously held in a decision written by Justice Page that the client’s interference with contract was justifiable based on the client’s reasonable inquiry and the advice from outside counsel that the noncompete agreement was probably not enforceable. The immunity occurred despite a judgment in Hennepin County District Court of nearly $160,000 against the employee who breached the noncompete provision.

The conduct of counsel is likely to be more observable by the public, at least in some circumstances, as a result of a ruling by the Supreme Court expanding televised court proceedings. In Order Amending General Rules of Practice, 2015 Minn. App. LEXIS 639 (Minn. 2015), the court, in a 6-1 decision, expanded permissibility of cameras-in-courtrooms, subject to some prohibitions on televising witness testimony, juvenile proceedings, sexual abuse matters, and certain other restrictions. But Justice Page, in his last decision before reaching mandatory retirement age of 70 this summer, dissented, bemoaning the potential for “unfair” reporting by the media, which may have a tendency to aggravate racial bias in those proceedings, compared to the “speculative [or] non-existent” benefits of such coverage.